Ashapura Intimates Fashion Ltd IPO Review (Avoid)

Review By Dilip Davda on Mar 23, 2013

Perhaps the last IPO for Fiscal 2012-13 is from BSE SME Platform that is likely to bid adieu to the primary market. With this the total tally for BSE SME IPOs will be 23 during the first year of SME platform.

Ashapura Intimates Fashion Limited (AIFL) is in the business of designing, trading, job contract manufacturing, branding, marketing and selling of intimate garments such as loungewear, bridal night wear / honeymoon sets, bathrobes and nighties since incorporation. The company expanded its product portfolio by adding other intimate garments such as sportswear, women's innerwear including lingerie. It now plans to foray into a new product category i.e. kids' innerwear having cartoon characters.

 AIFL's products such as loungewear, bridal night wear, honeymoon sets and bathrobes under the brands "Valentine" and "N-Line" are available through our large network of distributors to our customers in India as well as other countries. Its products such as nighties, maternity feeding nighties and bridal night wear (two pieces) are marketed under the brand called "Night & Day". Further in the year of 2011, the company  started marketing of sportswear, women's innerwear and lingerie's under the brands "Valentine Sportswear", "Valentine Secret Skin" & "Valentine Pink" respectively by leveraging its existing marketing network.

Now the company proposes to mobilize Rs. 21 crore to set up 10 (ten) Exclusive Brand Outlets, fund branding and marketing set-up, modernizations and investment in group companies along with other general corpus fund. For this it is coming ut with an IPO of 5250000 equity share of Rs. 10 each at a fixed price of Rs. 40 each. The issue opens for subscription on 28.03.2013 and will close on 04.04.13. Minimum application is to be made for 3000 shares and in multiples thereof, thereafter. KJMC Corporate Advisors (India) Ltd is the sole manager to this offer and Link Intime India Pvt. Ltd. is the registrar to the offer. CARE has assigned 'SME Fundamental Grade 4' to this IPO indicating very good fundamentals. Post allotment, the shares will be listed on BSE SME platform. The original face value of Rs. 100 per share was splitted in Rs. 10 in October 10. Between March 2009 to March 2011 it made preferential allotments at a price between Rs. 1000-Rs.2850 per share and In March 2012 it allotted  shares at par. It also issued two bonus shares in the ratio of 5 for 1 in March 2012 and 1 for 1 in October 2012.

On company's performance front, for the last three fiscals it posted an average EPS of Rs. 6.7 and NAV as on 31.03.12 is at Rs. 20.68. This will get diluted on post bonus issue. For first half of current fiscal it has earned net profit of Rs. 1.65 crore on a turnover of Rs. 57.47 crore. If we attribute this on annualized basis on the post IPO equity of Rs. 19.47 then the issue is at a P/E of 22 plus which is higher compared to its peers.


Conclusion / Investment Strategy

On merchant banker's mandate front, perhaps this is the first mandate and there is no past track record. Due to entry barrier and higher pricing, better to skip.

Reviewer recommends Avoid to the issue.

Review By Dilip Davda on Mar 23, 2013

Review Author

DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor before making any actual investment decisions, based on information published here. With entry barriers, SEBI wants only well-informed investors to participate in such offers. With crazy listings in the past, SME IPOs drew the attention of investors across the board. However, as SME issues have entry barriers and continued low preference from the broking community, any reader taking decisions based on any information published here does so entirely at own risk. The above information is based on information available as on date coupled with market perceptions. The Author has no plans to invest in this offer.

(SEBI registered Research Analyst-Mumbai).


About Dilip Davda

Dilip Davda

Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.

Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detail fundamental and financial analysis of companies coming up with IPO helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.

Email: dilip_davda@rediffmail.com

Ashapura Intimates Fashion IPO FAQs

  1. 1. Why Ashapura Intimates Fashion IPO?

    The initial public offer (IPO) of Ashapura Intimates Fashion Ltd offers an early investment opportunity in Ashapura Intimates Fashion Ltd. A stock market investor can buy Ashapura Intimates Fashion IPO shares by applying in IPO before Ashapura Intimates Fashion Ltd shares get listed at the stock exchanges. An investor could invest in Ashapura Intimates Fashion IPO for short term listing gain or a long term.

  2. 2. How is Ashapura Intimates Fashion IPO?

    Read the Ashapura Intimates Fashion IPO recommendations by the leading analyst and leading stock brokers.

  3. 3. Ashapura Intimates Fashion IPO what should investors do?

    Ashapura Intimates Fashion IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Ashapura Intimates Fashion IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts in the above answer.

  4. 4. Is Ashapura Intimates Fashion IPO good?

    Our recommendation for Ashapura Intimates Fashion IPO is to avoid.

  5. 5. Is Ashapura Intimates Fashion IPO worth Investing?

    As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to avoid the Ashapura Intimates Fashion IPO.

  6. 6. When will Ashapura Intimates Fashion IPO allotment status?

    The Ashapura Intimates Fashion IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Ashapura Intimates Fashion IPO allotment status to check.

  7. 7. When will Ashapura Intimates Fashion IPO list?

    The Ashapura Intimates Fashion IPO will list on Monday, April 15, 2013, at BSE SME.








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